Buy China, Thai stocks, says HwangDBS

ow would be the good time and opportunity to buy China and Thai stocks due to their reasonable valuation, said Chief Investment Officer of HwangDBS Investment Management Bhd, David Ng.

He said that while volatility will remain in the global markets with concerns on the Eurozone debt crisis, growth stories will come from the emerging markets.

He said emerging markets such as China and Thailand have the potential to stage strong solid uptrends if there is progress in the move for a resolution in the Euro-zone debt crisis in the coming months which will prevent a break-up within the 27-member EU countries.

"There are concerns that China will be in for hard landing, but our view is that China is more positive," Ng told Bernama, adding that there was good opportunity to buy China stocks which are reasonably valued for now.

"Bank stocks in China are cheap at this level as they have priced in a lot of bad news. Similarly the consumer sector in China, which has been expensive previously, has came to reasonable valuation due to some hiccups," he elaborated.

Ng said China stocks have come-off from their peak in 2007 and were now trading at lower Price Earnings. What makes the China growth story attractive is that the government policy makers are pro-active in balancing economic growth such as to limit speculation in the property market in order to allow property prices to come down.

Other positive factors include a more effective taxation system which encourages business, he explained.

"Policy makers are also striving to encourage the domestic sector to pick up to offset weaknesses in the external sector," he said.

On the Thai stocks, Ng said it was worth looking at investing in them especially the "airports stocks" for which the valuation has come down following the recent floods in the country. -- Bernama